Ann: Mulga Tank Mineral Resource Over 5Mt to Contained Nickel, page-149

Cost of the Starter Pit

The starter pit for the Mulga Tank Project, with 60 meters of sand overburden and 40 meters of oxidized rock (100 meters total), requires excavating approximately 6.6 million cubic meters of material (5.8 million m³ sand, 0.74 million m³ oxidized rock), equivalent to ~10.91 million tonnes (sand at 1.6 t/m³, oxidized rock at 2.2 t/m³). The cost estimate is based on industry-standard rates for open-pit mining in Western Australia, tailored to the project’s remote location and material properties.

• Depth: 100 meters (60 m sand + 40 m oxidized rock).
• Base area: Assume a 100 m × 100 m base (10,000 m²) to expose sufficient nickel sulphide ore for initial mining, consistent with the project’s large-scale open-pit potential.
• Slope angle: Given the sand cover, a conservative overall slope angle of ~35° is reasonable, with steeper slopes (e.g., 45–50°) possible in the oxidized rock layer. The sand’s loose nature dominates the slope design.

  
  

Surface Footprint

Horizontal offset = Depth × cot(35°) ≈ 100 × 1.43 = 143 meters per side.

• Surface dimension = 100 + 2 × 143 = 386 meters.
• Surface area ≈ 386 m × 386 m = 148,996 m² (~15 hectares).

Volume

Using the frustum volume formula:

• Surface area: 148,996 m².
• Base area: 10,000 m².
• Depth: 100 m.
• Volume ≈

  1003×(148,996+10,000+148,996×10,000)\frac{100}{3} \times (148,996 + 10,000 + \sqrt{148,996 \times 10,000})\frac{100}{3} \times (148,996 + 10,000 + \sqrt{148,996 \times 10,000})

  ≈ 6,587,833 m³.

Material breakdown:

• Sand (0–60 m): ~5.8 million m³ (based on average area approximation).
• Oxidized rock (60–100 m): ~0.74 million m³.

Cost Breakdown

1. Excavation:
   • Sand: 5.8 million m³ × A$3/m³ (easy excavation) = A$17.4 million.
   • Oxidized rock: 0.74 million m³ × A$7/m³ (includes drilling and blasting) = A$5.18 million.
   • Subtotal: A$17.4 million + A$5.18 million = A$22.58 million.
2. Haulage and Waste Dumping:
   • 10.91 million tonnes × A$1.5/tonne (short haul <2 km) = A$16.37 million.
3. Infrastructure:
   • Site preparation, access roads, dewatering: A$15 million.
4. Equipment:
   • Excavators, trucks, drills (capital and maintenance): A$7.5 million.
5. Labor and Overhead:
   • Remote workforce, camp costs: A$7.5 million.

Total Cost

• A$22.58 million (excavation) + A$16.37 million (haulage) + A$15 million (infrastructure) + A$7.5 million (equipment) + A$7.5 million (labor) = A$68.95 million, rounded to A$69 million.

Final Answer

The cost to develop and excavate the starter pit at the Mulga Tank Project, removing 60 meters of sand and 40 meters of oxidized rock (~6.6 million m³ or 10.91 million tonnes), is approximately A$69 million. This includes:

• Sand (5.8 million m³): ~A$17.4 million.
• Oxidized rock (0.74 million m³): ~A$5.2 million.
• Haulage, infrastructure, equipment, labor: ~A$46.4 million.

Notes

• This estimate assumes standard mining practices for a remote Western Australian site, with conservative costs for sand (easy to excavate) and oxidized rock (requires blasting).
• Costs could vary ±20–30% (A$50–90 million) depending on site-specific factors like groundwater or equipment availability.
• The estimate covers overburden removal and pit setup only, excluding ore mining or processing.
  
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